Guan Cha Zhe Wang·2025-12-10 09:56Core Viewpoint - The potential exit of Sunrise Duty Free (Shanghai) from Shanghai airports due to opposition from its major shareholder, China Duty Free Group, raises significant concerns within the industry and among consumers [1][2]. Company Summary - Sunrise Duty Free (Shanghai) has been operating for 26 years and is a prominent player in the duty-free market at major airports in China, including Shanghai Pudong and Hongqiao [3][4]. - The company is currently facing internal conflicts, particularly regarding its participation in the Shanghai airport duty-free store bidding process, with the majority of the board opposing the bid [2][6]. - The ownership structure includes China Duty Free Group (holding nearly 51%), Bai Rui Investment (33.32%), and Shanghai Airport Shangmian Commercial Development (15.68%) [3][4]. Industry Summary - The duty-free industry in China has experienced rapid growth over the past decade, with significant increases in sales figures, particularly in Hainan, where sales reached 24.59 billion yuan in 2025, a 10.94% increase year-on-year [8][10]. - The global duty-free market is projected to reach approximately 580 billion yuan in 2024, with a compound annual growth rate (CAGR) of 5%-7% expected from 2025 to 2027 [7]. - The recent policy adjustments and the upcoming implementation of zero-tariff policies in Hainan are anticipated to reshape the competitive landscape of the duty-free industry, potentially increasing competition among domestic and international players [12][13]. Market Dynamics - The bidding process for duty-free stores at Shanghai airports has been structured in a way that prevents related companies from bidding on the same segment, leading to internal competition between Sunrise Duty Free and its major shareholder [5][6]. - The overall market for duty-free shopping remains robust, but current sales figures have not yet returned to pre-pandemic highs, indicating ongoing challenges despite optimistic future projections [10][11].